DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, PANAJI vs. SHRI SANJEEV KUMAR MATHIYAN, MUZAFFARNAGAR

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ITA 4/PAN/2020Status: DisposedITAT Panaji06 November 2023AY 2013-14Bench: SHRI R.S. SYAL (Vice President), SHRI PARTHA SARATHI CHAUDHURY (Judicial Member)5 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that since no assessment was pending for the assessment year and no incriminating material was found during the search, no addition could be made under section 153A. The AO was at liberty to take recourse to other legal provisions if permissible.

What were the facts?

The assessee purchased shares at a price lower than their Fair Market Value, leading to an addition by the AO. The CIT(A) deleted the addition. The assessment year was 2012-13, and the return was filed belatedly under section 139(4).

What were the issues?

Whether additions under section 153A are permissible for an unabated assessment year when no incriminating material is found during search. Whether a completed assessment can be reopened under section 147.

Which sections of the Income-tax Act were involved?

Section 139(4),Section 143(2),Section 153A,Section 56(2)(vii)(c),Section 147

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Income Tax Appellate Tribunal, PANAJI BENCH, PANAJI

Before: SHRI R.S. SYAL & SHRI PARTHA SARATHI CHAUDHURY

For Appellant: Shri Neeraj Mangla
For Respondent: Shri Badrinath Yamaji Chavan

आदेश / ORDER

PER R.S.SYAL, VP :

1.

These two appeals by the Revenue arise out of the separate orders dated 04-10-2019 passed by the CIT(A)-2, Panaji in relation to the assessment years 2012-13 & 2013-14. Since the issue raised in these two appeals is common, we are, therefore, proceeding to dispose them off by this consolidated order for the sake of convenience.

2.

Briefly stated, the facts of the case for the A.Y. 2012-13 are that the assessee was subjected to search and seizure proceedings on 10-02-2016. Prior to that, the assessee had furnished the original return u/s.139(4) on 29-03-2013 declaring total income of Rs.11,79,610/-. Pursuant to search, the Assessing Officer (AO) completed the assessment by making an addition of Rs.1,62,49,406/- u/s.56(2)(vii)(c) of the Act on the ground that the assessee purchased shares of M/s. Mohit Ispat Limited and M/s.

Mathiyan Construction Pvt. Ltd. at a price lower than their Fair Market Value. The ld. CIT(A) deleted the addition, against which the Revenue has approached the Tribunal.

3.

Having heard the rival submissions and gone through the relevant material on record, it is seen as an admitted position that the assessment year under consideration is 2012-13. Return for this assessment year was filed belatedly u/s.139(4) on 29-03-2013.

Notice u/s.143(2) could have been issued within six months from the end of the financial year in which the return was filed, namely, by 30-09-2013. The assessee was subjected to search on 10-02-2016 and by that time no assessment for the year under consideration was taken up nor could have been taken up by virtue of the limitation u/s 143(2) of the Act. Once the position is so and admittedly no incriminating material was found during the course of search, the addition in respect of such an unabated assessment year could not have been made. Our view is fortified by the recent judgment of the Hon’ble Supreme Court in Pr.CIT Vs. Abhisar Buildwell (P) Ltd. (2023) 454 ITR 212 (SC) holding that if the assessment is not pending and no incriminating material is found during the course of search, no addition can be made in the assessment u/s.153A of the Act. It has further been observed that the completed assessment can be reopened by the AO in exercise of powers u/s.147 subject to the fulfilment of requisite conditions and those powers are saved. We are instantly concerned with the assessment u/s.153A of an unabated assessment year for which no incriminating material was found during the course of search. As such, the decision of the ld. CIT(A), deleting the addition on this score, is unexceptionable. However, the AO is at liberty to take recourse to the appropriate legal provisions in the light of the decision in of Abhisar Buildwell (supra), if permissible under the law.

4.

Both the sides are in agreement that the facts and circumstances of the addition made for the A.Y. 2013-14 and deleted in the first appeal are mutatis mutandis similar to the preceding year. Following the view taken hereinabove, we approve the impugned order on this count.

5.

In the result, both the appeals are dismissed. Order pronounced in the Open Court on 06th November, 2023.

Sd/- Sd/- (PARTHA SARATHI CHAUDHURY) (R.S.SYAL) JUDICIAL MEMBER VICE PRESIDENT पुणे Pune; िदनांक Dated : 06th November, 2023 सतीश आदेश की �ितिलिप अ�ेिषत/Copy of the Order is forwarded to: अपीलाथ� / The Appellant; 1. ��थ� / The respondent 2. 3. The CIT-2 , Panaji 4. DR, ITAT, Panaji Bench, Panaji गाड� फाईल / Guard file. 5. आदेशानुसार/ BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune

Date 1. Draft dictated on 06-11-2023 Sr.PS 2. Draft placed before author 06-11-2023 Sr.PS 3. Draft proposed & placed before JM the second member 4. Draft discussed/approved by JM Second Member. 5. Approved Draft comes to the Sr.PS Sr.PS/PS 6. Kept for pronouncement on Sr.PS 7. Date of uploading order Sr.PS 8. File sent to the Bench Clerk Sr.PS 9. Date on which file goes to the Head Clerk 10. Date on which file goes to the A.R. 11. Date of dispatch of Order. *

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